Asian Development Bank to provide $250-million loan for Infrastructure Financing Project in India

The Asian Development Bank (ADB) on 17 March 2011 pledged to provide a loan of $250-million as part of its infrastructure financing project in India. An agreement for the same was signed by the Government, ADB and the India Infrastructure Finance Company Ltd (IIFCL). This is the second tranche of loan for the ongoing Second India Infrastructure Project Financing Facility that was originally approved in 2009. The second tranche is aimed at stimulating infrastructure development through public-private-partnership investments in Maharashtra, Delhi NCR, Rajasthan and Gujarat. ADB had in 2009 agreed to provide a $700 million multi-tranche financing facility to help IIFCL provide long-term funding for infrastructure development.

The first tranche of $210 million was earmarked to finance three sub-projects for improving roads and highways in Madhya Pradesh, Punjab, Haryana, Himachal Pradesh and Delhi NCR apart from partially funding a power project in Kutch district of Gujarat. ADB had previously provided a $500 million loan to IIFCL for the First Infrastructure Project Financing Facility in 2007. About $381 million was disbursed in 2007 for 27 road subprojects and $89 million for two international airport sub-projects in Delhi and Mumbai.

ADB also signed an agreement with Rajasthan for a $63 million loan for urban development programmes in the state. It also entered into an agreement to provide a $78 million loan as the first tranche for urban infrastructure projects in the National Capital Region (NCR).